The UK's four largest banks accounted for more than half of the money put aside by FTSE 100 companies to cover litigation and regulatory costs in 2016, setting aside £14.6bn between them during the year.

Research by Thomson Reuters found the FTSE 100 as a whole set aside £26.2bn to meet legal claims in 2016, with Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland accounting for 56% of this total.

The £14.6bn figure, compiled from company reports filed in 2017 for the 2016 year, is down from a record £17.3bn spent by the banks in 2015 and £31.1bn in legal and regulatory costs for the FTSE 100 as a whole.

Commenting on the level of spending by the big four banks, Berwin Leighton Paisner BLP dispute resolution partner Richard Chalk said: "I am not surprised that spending is so high, and I think that has come from the increase in regulations that the banks are subject to.

"There were also lots of investigations into banks started in previous years, and dealing with those is a factor. I certainly don't see this level of spending falling in the next 12 months."

Mishcon de Reya disputes partner James Oldnall, who sits in the firm's banking and finance group, said the spike in spending in 2015 was likely to be related to claims to have arisen from the financial crisis.

Oldnall added: "When I am litigating against banks I see cost budgets, and they have got great terms with the law firms that they use, meaning that they pay heavily discounted rates. If the other 96 FTSE 100 companies were using those same law firms, they would probably be paying a lot more, so that masks the extent to which the banks are outspending other companies."

During the same time period, oil and gas companies paid out 19% of total FTSE 100 litigation provisions, amounting to more than £5bn, while pharmaceutical companies spent £1bn, up from £612m in 2015. Provisions accounted for include litigation costs, regulatory fines and compensation.

Fourteen FTSE 100 companies reported provisions of more than £250m in their company reports, with the Thomson Reuters research stating that the level of spending shows that a "broad cross-section of UK companies have had problems in managing down the cost of legal or regulatory action taken against them".

The research further states that as a result of high expenditure levels, "litigation funders are on the march". This follows litigation funder Burford Capital revealing that it put more than $1.3bn (£933m) of investment into portfolio finance deals in 2017.